Despite assurances from the Federal Government that the naira has been fully floated, Nigeria’s currency continues to depreciate at an alarming rate — exposing what many now describe as a managed float hidden beneath layers of official rhetoric.
Since the controversial declaration in June 2023 that the naira would be allowed to find its true market value, the Central Bank of Nigeria (CBN) has spent a whopping $5.78 billion in direct interventions to support the currency. Yet, the naira’s value has plummeted, most recently closing at N1,608 to the dollar.
In 2025 alone, the CBN has already burned $669 million in a desperate bid to halt the naira’s decline — an effort that appears increasingly futile as the currency continues its downward spiral.
This interventionist trend contradicts the very essence of a floating exchange rate, which is meant to be determined purely by supply and demand, without government interference. Instead, the CBN has been actively involved in stabilizing the currency, even while insisting otherwise.
In February 2024, the apex bank distributed $20,000 to each licensed Bureau De Change (BDC) at a subsidized rate of N1,301/$1, in an attempt to narrow the gap between the official and parallel market. Similarly, in July 2024, over $148 million was pumped into the market in just two days to calm rising volatility.
Again, in April 2025, amid global economic tremors, particularly oil price shocks, the CBN intervened with $197.71 million to protect the naira. However, these injections have done little to stop the slide.
The cost of these efforts is beginning to reflect in Nigeria’s external reserves, which fell from $40.88 billion in December 2024 to $39.72 billion by February 2025, signaling the unsustainable nature of the defence.
Despite this, the CBN maintains that it is not “defending” the naira with reserves. But the numbers tell a different story. Market analysts have pointed out that the frequency and scale of interventions indicate that the naira is not truly floating — rather, it's being artificially managed within a hidden band.
The contradiction is stark: a “floating” currency still receiving weekly lifelines. The billions spent and still counting confirm what Nigerians are witnessing daily — a policy that promises freedom but delivers control, a system where the naira floats only when it sinks.
As economic pressures mount and confidence erodes, the question remains: how long can the CBN keep burning dollars to defend a currency it claims to have let go?